Homeowners Can Cut Federal Income Taxes Up to $1,500 and Reduce Home Energy Bills With Energy Efficiency Tax Credits

/PRNewswire/ -- The Tax Incentives Assistance Project (TIAP) urges U.S. homeowners to enjoy the "triple crown" of energy efficiency -- lower home energy bills, lower federal income taxes, and increased home comfort -- by making energy efficiency home improvements that qualify for up to $1,500 in federal income tax credits.

Savvy consumers who make such energy efficiency upgrades can also be proud of reducing their personal carbon footprint -- because using less energy in their homes means emitting less pollution, too.

The federal income tax credits for specific home improvements are available now through 2010, thanks to the American Recovery and Reinvestment Act of 2009 (ARRA), which extended energy efficiency tax credits available in 2006 and 2007 but not 2008.

"The ARRA tax credits are very similar to those that were in effect a few years ago and renewed for 2009 only in the Troubled Asset Relief Program (TRP) last fall," said Steve Nadel, executive director of the American Council for an Energy-Efficient Economy (ACEEE), a TIAP founder.

"But the ARRA tax provisions include some 'new wrinkles' that are important for consumers to be aware of, so they can be sure to install the specific products and equipment that qualify for the 2009-10 tax credits. TIAP is making it easy for taxpayers to purchase eligible products by providing all the needed information on the TIAP Web site (www.energytaxincentives.org), which also includes links to other helpful sites."

"The ARRA tax credits are potentially worth three times as much as the 2006-07 tax credits, at up to $1,500," noted Kateri Callahan, president of the Alliance to Save Energy, another TIAP founder. "This more generous dollar amount puts energy- and money-saving home improvements within reach for more American homeowners. And the longer time frame, through 2010, gives homeowners more than a year to plan and budget for the more costly energy efficiency upgrades, which will then provide a terrific return on investment in lower energy costs for years to come."

Some of the important details on the home improvement tax credits are as follows:

-- For each type of qualifying equipment, the credit is for 30 percent of
the cost up to $1,500.
-- It is a one-time tax credit that can be claimed in part or in whole
for tax year 2009 and/or tax year 2010.
-- Homeowners who claimed the $500 credit available in 2006-7 can claim
the remaining $1,000 credit for additional products bought and
installed in 2009 and/or 2010.
-- There are two basic categories of qualifying equipment -- "building
envelope" products and heating and cooling equipment.
-- Building envelope products are replacement windows (including storm
windows, storm doors, and skylights), certain ENERGY STAR asphalt and
metal roofs, insulation, and other sealing products.
-- Heating and cooling equipment includes furnaces, boilers, ground
source or geothermal heat pumps, gas or propane water heaters, central
air conditioning systems (but not window air conditioner units), and
biomass stoves.
-- Installation costs are not covered for building envelope products.
-- Installation costs are covered for heating and cooling equipment.
-- For some products, the qualifying criteria are more stringent than
they were in 2006 and 2007 and in early 2009 under TARP. For example,
all ENERGY STAR windows no longer qualify; now they must meet
additional energy efficiency criteria (spelled out on the TIAP Web
site at http://energytaxincentives.org/consumers/insulation_etc.php.)
-- Specific efficiency criteria also apply to heating and cooling
equipment;
(http://energytaxincentives.org/consumers/heating-cooling.php).
-- Under TARP, the 2006-7 criteria for qualifying products were in effect
from January 1, 2009 through February 17, 2009, when the ARRA was
signed.
-- The TARP criteria, however, apply to exterior windows and skylights
purchased and put into service before June 1, 2009.
-- Homeowners who purchased and put into service equipment under the TARP
criteria between January 1 and February 17, 2009, can claim the higher
($1,500) tax credit amount.

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